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Vietnam can build international airport within 36 months: IATA

According to IATA’s (International Air Transport Association) forecasts, Vietnam’s aviation industry will see a high growth rate of 9.5 percent in 2011.

In an interview given to Dau Tu newspaper, Giovanni Bisignani, Chief Executive Officer of IATA, said that during his business trip to Vietnam he saw high potentials of Vietnam’s aviation market.

He said that despite bid difficulties, airlines in Asia Pacific, including Vietnam, can still earn high profits, estimated at $4.6 billion in 2011. It is partially because the expected economic growth rate of the region is at 6.9 percent, which is higher than the world’s average growth rate. In 2010, Vietnam Airlines saw its number of passengers increase by 30 percent from the previous year, and it had more new aircraft every month. This shows that Vietnam’s aviation market has great potential.

According to IATA’s forecasts, Vietnam’s aviation industry will see a growth rate of 9.5 percent in 2011. It is expected that by 2014, Vietnam will become the third fastest growing market in terms of carrying international passengers and cargo and will show an overall growth rate of 10 percent. It may also be the second fastest growing market in terms of carrying domestic passengers.

In order to obtain that goal, Vietnam’s aviation industry needs to be built and supported by practical policies that show that this is a dynamic industry which requires regular changes.

Regarding the world’s aviation market in 2011, Mr Giovanni Bisignani said that after a decade of recession from 2001 to 2009, the world’s aviation market has a net profit of $15.1 billion, a undeniable sign of recovery. The latest forecast about the net profit for 2011 says that is is possible that profits will be $9.1 billion, higher than the forecast given previously by IATA.

It is expected that in 2011 the demand for carrying passengers and cargo in the globe would increase by 5.2 and 5.5 percent, respectively. The passenger carrying capacity will increase by 0.5 percent. Since the operational environment has become tougher, it will be difficult to obtain high profits. The biggest obstacle for airlines is the possible increases in fuel prices. Fuel expenses are forecasted to be for 27 percent of the total expenses. The figure was 26 percent in 2010.

Besides, another factor that may lead to decreases in turnover is low GDP growth rate which is forecast to be 2.6 percent, much lower than the 3.5 percent level in 2010.

When asked what suggestions IATA can make for Vietnam, so that the country’s aviation industry still can keep a high growth rate in the next years, Mr Giovanni Bisignani said that first of all, the national flag air carrier Vietnam Airlines should prioritize following global technology standards on air traffic control in accordance with the regulations of the International Civil Aviation Ofrganisation ICAO. He said he hopes that the Vietnam Air Traffic Control Centre will use air traffic surveillance technology ADS-B (Automatic Dependent Surveillance Broadcast) and Performance Based Navigation (PBN). ADS-B and PBN allow aircrafts to fly more efficiently using satellite-based navigation systems and improve safety conditions when landing.

The government of Vietnam has programmed the airport system already, but still needs to set up reasonable policies in order to persuade investors to pour money to build aircrafts. If the government is determined enough and has reasonable policies, just within 36 months it can secure an international airport, capable of serving 50 million passengers a year.

The IATA’s chief said that IATA highly appreciates the policy on airfare reduction in the last three years (since April 2009) which has helped ease the expenses for domestic airports.

He also said that IATA is waiting for the government to ratify the Montreal 99 Treaty, so that the IATA e-freight program can be applied at Vietnam Airlines and other airlines in Vietnam.

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